Think the Dementia Tax is unfair? Think again

Remember the Dementia Tax scandal during the recent general election campaign? Remember Labour – the hypocrites – banging on about how unfair it was that those who become ill with dementia will have to sell their homes to pay for care whereas those who get cancer are treated for free on the NHS?

Well yes, that is rather unfair but it’s the current process, which has been in place for years. Anybody requiring care in a care home currently has to sell their home to pay for care if they don’t have sufficient cash assets to do so.   Only once the value of their assets (including their home) drops below £23,500 do they stop paying – at this stage, the council steps in.

The Conservative proposals were to raise the level at which people stop paying for care, to £100,000. So for those currently paying for residential social care, this would actually be an improvement, allowing them to hold onto a larger proportion of their life savings, which could then be passed onto their children after their death.

The key change with the dementia tax was with regards to those currently receiving social care in their own homes (which, for the most part, will not be those with dementia but will be those with other long-term illnesses who are still able to live at home but require daily care and support in their homes).

Currently, if you are being cared for in your own home, the value of your home does not get taken into account when assessing whether or not you can afford to pay for care. So if you’re living in a home worth £1 million but your cash assets are worth less than £23,500 you don’t pay for care at all, and can leave the home to your children when you die. In contrast, somebody who owns a home worth significantly less, with no cash assets, who has to be cared for in a care home, not only has to pay for their own care, but has to sell their home to do so.

Need to pay for care but struggling to sell your home?  No problem – you can enter into a Deferred Payment Arrangement with the council, at a setup cost of a few thousand pounds to cover legal and administrative costs, with daily interest charged at around 2% (way above the current base rate) to be repaid either when you’ve sold the house, or when you die.

Ask yourself if that is fair. Now let me throw in an extra fact. Those who pay for their own care get charged a premium over and above the “real cost” of care, in order to subsidise those who are paid for by the council. So a bed in a care home may cost the council £800 a week – but if an elderly resident is self-funding, they may be charged £1200 a week for that same bed. The difference is used to subsidise not only those living in care homes who are not able to pay for their own care, but also those being cared for at home, who are not paying for their own care.

So just to recap – under the current system, somebody who owns a house worth, say, £200,000, can be forced to sell that house to pay for care. The same goes for somebody who owns no property but has cash savings of more than £23,500. The money they get charged will pay not only for their own care, but will also be used to subsidise others who don’t pay, including those living in million-pound houses being cared for at home.

The Tories wish to change that system so that everybody who can afford to pay for care, does – regardless of whether that care takes place in their own home or in a care home.   Spread the burden of social care more evenly across society, in other words. And Labour, which calls itself the party “for the many, not the few” chose not only not to support the policy, but to attack it and paint it as less fair than the current system.

It is not remotely fair that some people become ill in old age and require long-term care whereas others do not. But that is a fact of life which we just have to deal with in the best way possible – and surely the fairest way in which to do so, is to ensure that everybody who can afford to pay, does. The current system, which allows those living in ludicrously expensive houses to be subsidised by those whose total assets are much fewer, is the most spectacularly unfair system I have come across.

Bring on the dementia tax. Do it now.

 

 

 

 

 

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